8 Apr 2009 07:00
8 April 2009
IMMEDIA GROUP PLC (formerly Immedia Broadcasting Plc)
Preliminary Statement of Results for the FY to 31 December 2008
Immedia Group Plc ("Immedia"), the UK's leading provider of live, tailored in-store radio and TV, today announces its preliminary financial results for the year to 31 December 2008.
Overview
| Move into profit: pre tax profit of £82,934 (2007: pre tax loss of £1,355,410) | |
| Improved cash position with £883,197 cash at bank as at 31 December 2008 (31 December 2007: £661,845) | |
| New contract signed with major UK high street bank for RadioVision | |
| Installation and maintenance services business continues to expand |
Financial Summary
| 12 months to 31 December 2008 | 12 months to 31 December 2007 | |
| Revenue | £3,875,010 | £3,904,815 |
| Operating profit before depreciation, amortisation and impairment charge | £304,943 | £206,369 |
| Operating profit/(loss) | £57,116 | £(1,375,909) |
| Profit/(loss) before taxation | £82,934 | £(1,355,410) |
| Basic and diluted earnings/(loss) per share | 0.56p | (9.13)p |
| Year end balance of cash and cash equivalents | £883,197 | £661,845 |
Bruno Brookes, Chief Executive of Immedia, said:
"I am pleased that Immedia is seeing the fruits of initiatives taken to broaden its content offering to an ever wider potential market. In particular, our new installation and services division is winning new clients and offering the opportunity to cross-sell other Immedia services.
"Over the next year we aim to maintain our market leading position as the one-stop shop for any company, big or small, seeking the most professional service in the digital out-of-home media sector."
Enquiries:
| Immedia Group Plc | |
| Bruno Brookes - Chief Executive | +44 (0) 1635 556200 |
| Hudson Sandler | |
| Nick Lyon / Fran Read | +44 (0) 20 7796 4133 |
| Daniel Stewart & Company Plc | |
| Simon Leathers / Simon Starr | +44(0) 20 7776 6550 |
Chairman's Statement
2008 was a year of improvement for Immedia and we have delivered a solid performance against a turbulent economic background. We are pleased to be able to announce that we have moved into profit, a result achieved through tighter cost controls across the business and up-selling new services to our clients.
While revenue for the year was marginally lower at £3,875,010 compared to £3,904,815 for 2007, Immedia achieved a pre tax profit of £82,934 for the year which was a significant improvement on the 2007 pre tax loss of £1,355,410. Furthermore, the company has maintained its record of strong cash generation, with cash and cash equivalents of £883,197 at the year-end, again a significant improvement on the prior year balance of £661,845.
In November we were pleased to welcome Mark Horrocks to the Board as a Non-Executive Director. Mark has held extensive positions in the City and we believe that Immedia will benefit from his wealth of experience. I would also like to take this opportunity to thank all our staff for their hard work and enthusiasm over the period in helping the business grow.
We are operating in an evolving sector that is seeing growth in demand for out-of-home digital media solutions across a variety of markets, including retail, leisure and finance. Immedia has the skills to take advantage of this increasing demand for content and we continue to develop new innovative solutions to meet our clients' needs.
In light of the current economic conditions we are cautious about the year ahead but believe that the strength of our product offering and the breadth of our services position us well to continue to serve the needs of our high quality client base and in doing so attract new customers.
Geoff Howard-Spink
Chairman
Business Review
I am pleased to present our full year results for the financial year ending 31 December 2008.
Results & Financial Performance
The year was a challenging one for Immedia but we maintained our focus on cost control and profitability and recorded a move to both operating and pre tax profit. Revenues for the year were marginally lower at £3,875,010 (2007: £3,904,815). Pre tax profit increased to £82,934 from a pre tax loss of £1,355,410 in 2007. 2007's results were impacted by the £1,055,225 write-off of Cube's intangibles. As reflected in the current year results we do not anticipate any further impairment charges.
During the year the Group spent £109,000 on the fitting out and equipping of its new offices in Newbury, of which £66,000 was financed by a three year covenant-free unsecured bank loan bearing interest at 4% above bank base rate. This cost included expenditure in improved technology and equipment for the delivery of the Group's services, and further investment in these areas is planned to ensure Immedia's services continue to be market leading.
The Group has continued to strengthen its balance sheet over the period. We continue to rigorously control our costs and the Group remains cash generative with £883,197 cash in the bank as at 31 December 2008 (31 December 2007: £661,845).
On the basis of current financial projections prepared up to the end of 2010, recent news of contract renewals, continuing improvements in management of costs, and ongoing availability of facilities, the Directors are satisfied that the Group has adequate resources to continue in operation for the foreseeable future and consequently the financial statements have been prepared on the going concern basis.
Subscription Stations
Our subscription radio stations continue to perform well, with new opportunities to help our clients with product development. We have integrated the radio and visual strands of our business and have been encouraged by the strong growth of our installation and maintenance business.
On 2 June 2008 we were delighted to announce a two year contract with Roadchef to provide a brand new live radio station to all 29 Roadchef motoring service areas in the UK. This station was successfully launched in July 2008.
Also in July we announced a significant memorandum of understanding with a leading retail banking brand. The trials of our RadioVision product with this company have been very successful and we announced the signing of our contract with a major UK high street bank on 1 April 2009.
Our audio and visual equipment installation and maintenance services business has continued to expand over the period, and has driven growth by providing additional services to existing contracted clients and to new clients who initially seek ad hoc services. There is a significant opportunity for cross-selling our complementary radio services and we expect a number of these clients will look to sign longer term contracts.
Our relationship with HSBC remains strong and our HSBC Live! subscription radio station continues to broadcast to over 1,000 sites across the UK. We have extended the service to HSBC call centres and other corporate buildings.
IKEA Live! has been well received across all its 21 UK locations, including the new store in Southampton, and we will bring Immedia to Ireland with the opening of IKEA's Dublin store later in 2009.
Lloyds Pharmacy Live! operates across all 1,500 stores and we look forward to further developing our longstanding relationship with the team and assisting with new areas of product development during our seventh year of service.
We have been working closely with SPAR and provide a subscription model to more than 1,400 stores across the UK, replacing the free to air service. This has resulted in a lower cost base as well as an increase in revenue. Over the course of the year we continued to install our services across more of its 2,500-strong estate.
We are now broadcasting GAME Live! to 379 GAME stores across the UK, having moved on from pre-contract trials and installations in 2007 to a full subscription service in the first half of 2008.
We are currently trialling other radio stations and believe that our breadth of offering will continue to attract new clients.
Current Trading and Outlook
2008 was a challenging year for Immedia but we believe that over the period the company has matured: Immedia is not just a radio business and we are actively working to broaden our offering. In 2009, we intend to increase the flexibility of our services by offering a wider range of music and video content offerings to bolster our core business. This will enable clients of any size to purchase the content they need, in line with their requirements and budgets. We will continue to develop our screen business, providing more hardware, telecoms and visual content, and will support this through the further growth of our installation and maintenance business.
While we remain cautious about the outlook for 2009, we believe that our services are the best on the market and we will continue to search for ways to bring our offering to new audiences, while developing new opportunities among our strong portfolio of existing clients.
Bruno Brookes
Chief Executive
Consolidated Income Statement
for the year ended 31 December 2008
| 2008 | 2007 | ||
| £ | £ | ||
| Revenue | 3,875,010 | 3,904,815 | |
| Cost of sales | (1,608,926) | (1,691,821) | |
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| Gross profit | 2,266,084 | 2,212,994 | |
| Administrative expenses before impairment charge on intangible assets Impairment charge on intangible assets | (2,208,968) - | (2,533,678) (1,055,225) | |
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| Operating profit/(loss) | 57,116 | (1,375,909) | |
| Operating profit before depreciation, amortisation and impairment charge | 304,943 | 206,369 | |
| Depreciation and amortisation | (247,827) | (527,053) | |
| Impairment charge on intangible assets | - | (1,055,225) | |
| Finance income | 25,925 | 22,374 | |
| Finance cost | (107) | (1,875) | |
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| Profit/(loss) before taxation | 82,934 | (1,355,410) | |
| Income tax expense | (2,816) | 72,750 | |
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| Profit/(loss) for the year attributable to equity shareholders | 80,118 | (1,282,660) | |
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| Continuing operations | |||
| Earnings/(loss) per share - basic | 0.56 p | ( 9.13)p | |
| Earnings/(loss) per share - diluted | 0.56 p | ( 9.13)p |
There was no income and expense for the current or comparative periods other than that reported in the consolidated income statement.
Consolidated Balance Sheet
At 31 December 2008
| 2008 £ | 2007 £ | |||
| Non-current assets | ||||
| Property, plant and equipment | 196,479 | 208,837 | ||
| Intangible assets | 291,085 | 377,190 | ||
| Total non-current assets | 487,564 | 586,027 | ||
| Current assets | ||||
| Inventories | 96,142 | 3,703 | ||
| Trade and other receivables | 617,003 | 675,975 | ||
| Prepayments for current assets | 131,282 | 151,550 | ||
| Cash and cash equivalents | 883,197 | 661,845 | ||
| Total current assets | 1,727,624 | 1,493,073 | ||
| Total assets | 2,215,188 | 2,079,100 | ||
| Share capital | 1,455,684 | 1,455,684 | ||
| Share premium | 3,586,541 | 3,586,541 | ||
| Merger reserve | 2,245,333 | 2,245,333 | ||
| Retained losses | (6,666,324) | (6,712,729) | ||
| Total equity | 621,234 | 574,829 | ||
| Liabilities | ||||
| Loans and borrowings | 44,000 | - | ||
| Deferred tax liabilities | 15,296 | 12,480 | ||
| Total non-current liabilities | 59,296 | 12,480 | ||
| Loans and borrowings | 22,000 | - | ||
| Trade and other payables | 1,434,798 | 1,416,926 | ||
| Deferred income | 77,860 | 74,865 | ||
| Total current liabilities | 1,534,658 | 1,491,791 | ||
| Total liabilities | 1,593,954 | 1,504,271 | ||
| Total equity and liabilities | 2,215,188 | 2,079,100 | ||
| Total net current assets | 192,966 | 1,282 | ||
| Total net non-current assets | 428,268 | 573,547 | ||
| Net assets | 621,234 | 574,829 |
Consolidated Cash Flow Statement
for the year ended 31 December 2008
| 2008 £ | 2007 £ | ||
| Cash flows from operating activities | |||
| Profit/(loss) for the year attributable to equity shareholders | 80,118 | (1,282,660) | |
| Adjustments for: | |||
| Depreciation, amortisation and impairment | 247,827 | 1,582,278 | |
| Financial income | (25,925) | (22,374) | |
| Financial expense | 107 | 1,875 | |
| Loss on sale of property, plant and equipment | 2,871 | 19,138 | |
| Deferred tax charge/(credits) | 2,816 | (72,750) | |
| Decrease in trade and other receivables | 79,240 | 401,909 | |
| (Increase) in inventories | (92,439) | (1,294) | |
| Increase/(decrease) in trade and other payables | 20,867 | (187,973) | |
| Net cash from operating activities | 315,482 | 438,149 | |
| Cash flows from investing activities | |||
| Proceeds from sale of property, plant and equipment | 423 | 1,753 | |
| Interest received | 25,925 | 22,374 | |
| Acquisition of property, plant and equipment | (152,658) | (22,469) | |
| Net cash from investing activities | (126,310) | 1,658 | |
| Cash flows from financing activities | |||
| Interest paid | (107) | (1,875) | |
| Repayment of borrowings | - | (14,104) | |
| Proceeds from long term borrowings | 66,000 | - | |
| Purchase of own shares for EBT | (33,713) | - | |
| Payment of finance lease liabilities | - | (4,778) | |
| Net cash from financing activities | 32,180 | (20,757) | |
| Net increase/(decrease) in cash and cash equivalents | 221,352 | 419,050 | |
| Cash and cash equivalents at 1 January | 661,845 | 242,795 | |
| Cash and cash equivalents at 31 December | 883,197 | 661,845 |
Notes
(forming part of the financial statements)
The financial information set out above does not constitute the Company's statutory accounts for the years ended 31 December 2008 or 2007 but is derived from those accounts. Statutory accounts for 2007 have been delivered to the registrar of companies, and those for 2008 will be delivered in due course.
The auditors have reported on those accounts; their report was (i) unqualified, (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report and (iii) did not contain a statement under section 237(2) or (3) of the Companies Act 1985.
The 2008 accounts will be delivered to the registrar of companies following the Company's Annual General Meeting. The Annual Report and Notice of Annual General Meeting will be posted to the shareholders by 19 May 2009 and will be made available on the Company's website (www.immediaplc.com) at that time.
This preliminary announcement was approved by the Board on 7 April 2009.
1. Reporting entity
Immedia Group Plc (the "Company") is a company incorporated and domiciled in the United Kingdom. The address of the Company's registered office is 5 Fleet Place, London EC4M 7RD. The principal place of business is at The Old Brewery, The Broadway, Newbury, Berkshire RG14 1AU.
The consolidated financial statements of the Company as at and for the year ended 31 December 2008 comprise the Company and its subsidiaries (together referred to as the "Group"). The Group primarily is involved in marketing and communication services through radio and screen based media.
2. Basis of preparation
The consolidated financial statements have been prepared and approved by the directors in accordance with International Financial Reporting Standards as adopted by the EU ("Adopted IFRSs").
On the basis of current financial projections prepared up to the end of 2010, recent news of new contracts and of contract renewals, continuing improvements in management of costs, and ongoing availability of facilities, the Directors are satisfied that the Group has adequate resources to continue in operation for the foreseeable future and consequently the financial statements have been prepared on the going concern basis.
3. Share capital and reserves
Reconciliation of movement in capital and reserves
| Share capital | 2008 | 2007 | ||
| £ | £ | |||
| Authorised | ||||
| 36,000,000 Ordinary shares of 10 pence each | 3,600,000 | 3,600,000 | ||
| Allotted, called up and fully paid | ||||
| 14,556,844 Ordinary shares of 10 pence each | 1,455,684 | 1,455,684 | ||
| Movements in year | ||||
| At beginning of year | 1,455,684 | 1,334,056 | ||
| 1,216,281 Ordinary shares of 10 pence each (issued at 15 pence each) | - | 121,628 | ||
| 1,455,684 | 1,455,684 | |||
| There are no restrictions on the transfer of shares in Immedia Group Plc. All shares carry equal voting rights. | ||||
| Reserves as | Share premium account £ | Merger reserve £ | Retained earnings £ | ||
| At 1 January 2008 | 3,586,541 | 2,245,333 | (6,712,729) | ||
| Retained profit for the year | - | - | 80,118 | ||
| Purchase of own shares by Employee Benefit Trust | - | - | (33,713) | ||
| At 31 December 2008 | 3,586,541 | 2,245,333 | (6,666,324) |